If the economy is heading into a Depression, which I think is a fast certainty without a bold stimulus, we must try to prevent problems with food and energy supply. It might sound overly pessimistic. However, disruptions can happen quickly and its consequences for social stability can be dire.

My series of articles has so far shown that the $1000/month income/cost gap of the average American leads to an economic downsizing of at least 27% and more from rising unemployment. That needs bold government action to address the above root problem. Market mechanisms fail and looming risk factors in the derivative market need to be contained. I proposed to sweep up the unemployed through government infrastructure, education, and military programs in order to keep the "supply" side of the labour market below 7%. In my last article, I made the case that state and local governments have to rely on the Federal government to keep their cost up.

In respect to food and energy supply, there are three issues that need to be addressed carefully:

1) possible disruptions in the transportation of food and energy supply due to failing of large market players

2) possible shortages in food production due to falling food prices leading to farmers abandoning their trade or going bankrupt

3) possible disruptions du to internal or external aggression

Transportation

Hurricanes Katrina and Ike demonstrated how fragile those systems are. What I did not understand was why the military would not move in immediately and provide for necessary services. I have seen bold military action in crisis situations in other countries, including democratic Switzerland, that has helped ease problems during catastrophes very quickly. I think that being a catastrophe task force should be one of the main peace tasks of any military. Plans should be enacted, at little cost to the taxpayer, that ensure that disruptions to transportation systems for food and energy can quickly be addressed and eliminated.

Food production

I am so much against farm subsidies that I'd like to bail out and rather not say it: America needs to make sure that staple farmers stay put and keep on producing. Wine and bio fuel (sorry) are not as critical as staple production. They don't need supporting. However, if farm income becomes negative, the government will have to step in with cheap bridge financing as a first line of defence and subsidies if the first line does not hold. It's a matter of national security that the food output does not fall significantly. The last thing that America needs is a famine. I might be too pessimistic. However, a healthy pessimism here can potentially save millions of people at the cost of a few billion dollars. I don't know exactly how to structure a farm sustaining deal, but it needs to be said.

Internal/external aggression

America is at its most vulnerable when its economy is at its weakest. People that have a scorn on the U.S. are intelligent enough that damage is greatest when the target is already down. I am amazed how lax airport security has become again and I think that it is time to tighten the checks. The number one goal must be to neutralize Bin Laden and his operatives quickly. America is too distracted and spread too thin in order to successfully respond to a major challenge without opening strategic opportunities on other places such as the surprisingly calm Iraq/Iran front. If you are amongst those that wonder why, Iran's culture, amongst other differences, has a concept of time that is starkly opposing to ours. Time is NOT of the essence. Iran will move into strategic voids when their time is here, given by God. If that happens, one of the few options to have them escape Gods wrath will be to evacuate 7 million Israelites to the United States. Well, that would appease the Middle East, wouldn't it, for now. Let me kid around a little more: It would take 23'000 airlifts between the U.S. and Israel, which would safe the airline industry from disaster. 2 million new homes would be needed, which would stop the housing crisis. They are a busy people, which would help us buying more big-screen TVs. They are (money)smart, which would help us to smarten up. Depression avoided, let's get back to party. The Bible says that they are a wicked people, though.

This article is part of a series of articles focussing on what local, state and federal governments need to do now in order to address the upcoming economic Depression.

economic stimulus (1): the disabled consumer

at http://www.ireport.com/docs/DOC-132064

economic stimulus (2): focus on income and equity

at http://www.ireport.com/docs/DOC-132067

economic stimulus (3): quarantine risk

at http://www.ireport.com/docs/DOC-132200

economic stimulus (4): sweep up the unemployed

at http://www.ireport.com/docs/DOC-132202

economic stimulus (5): bailout state governments

at http://www.ireport.com/docs/DOC-132205

economic stimulus (6): protect food and energy supply

at http://www.ireport.com/docs/DOC-132795

economic stimulus (7): invest into the future

at http://www.ireport.com/docs/DOC-132856

economic stimulus (8): be globally the most competitive

at http://www.ireport.com/docs/DOC-133022 

economic stimulus (9): change politics

at http://www.ireport.com/docs/DOC-133026

economic stimulus (10): prepare for budget cuts

at http://www.ireport.com/docs/DOC-133113

Please comment. I will try to address questions, if I can.

H.R. Tschudi, economist and entrepreneur, Vancouver